MODEL

31910  Del  Obispo,  Suite  100,  San  Juan  Capistrano,  CA  92675  

Redefining the way compelling big data startups are created.

OVERVIEW OVERVIEW

Frost Data Capital is a combined incubator and venture capital firm with a unique approach, designed specifically to capture some of the enormous value that will be created as the Big Data revolution unfolds. Based out of Southern California, Frost Data Capital has built an eco-system of innovative start-ups, with deep expertise in big data, entrepreneurialism, advanced technology, analytics, and the Industrial Internet. 

FOCUS

Unlike most other incubators who have a slush pile of business plans waiting to be read, we NEVER look at outside deals. We focus solely on Big Data analytics and source all of our ideas internally.

We are creating one of the biggest ecosystems of related Big Data startups anywhere in the world.

SCALE

We do this by creating teams and processes (along with the underlying technology backbone) that can scale.

The Frost Data Capital Model recognizes that scale is vital, and builds this into the approach from the start.

LEADERSHIP

We find CEOs who quickly take ownership of the

founding concept, with the experience and skill to develop

the idea into a compelling company.

 

We don’t expect our CEOs to come up with

the founding or take significant personal risks,

since we have capital available.

When combining their extensive experience and the capabilities of our shared incubator team, our Frost Data Capital Model is far less

risky and much more scalable.

IDEAS

Most people struggle to come up with one compelling startup idea in their entire lifetime.

We have a team of highly experienced business development staff, who are constantly talking with senior execs at Fortune 100 companies, strategic partners like the major software vendors and leading system integrators.

As a result, we generate a significant number of new ideas.

PARTNERS

Our strategic partners are a source of ideas, validation, funding, and channels to market. Working closely with them is a key element of the Frost Data

Capital Model.

Most importantly, they are also potential acquirers of our

companies.

We have partnered with GE to create Frost I3 , The Incubator for the Industrial Internet, where we will launch 30 new companies over the next 3 years. Learn more. www.frosti3.com

FINANCING

Most acquisitions of enterprise software companies occur at valuations between $75m and $150m, with a typical return to a VC investor of around $25m. Unfortunately, this reality is at odds with the needs of most large VCs.

Our goal with the Frost DC Model is to achieve a much higher success ratio, partly by ensuring our companies are built such that a $100m exit is a great outcome for all concerned.

STARTUP MOJO

The hardest aspect of our operation to scale is what we call ‘Startup Mojo’. Some of this is simply having the cojones to go out and validate your vision with partners and customers, but most of it comes down to two points:

1.  The ability and willingness to make high quality decisions with very limited data.

2.  The occasional intuitive leap.

With the Frost DC Model we guide our companies using a process that helps us to identify when and where (and sometimes even how) those intuitive leaps can be made.

PROCESS

All of our companies go through the same process, which was created at our inception in 2010 and follow Lean Startup principles. Critical concepts include:

➔  Hypothesis validation

➔  The business model canvas

➔  Minimum Viable Segment (MVS) (“Looking for bowling alleys”)

➔  Minimum Viable Product (MVP)

➔  Frequent stand-up meetings to share information

We create companies in batches of 4-6 which allows us to put all of the new leaders through the process at the same time so they can learn from each other as well as getting input from the core incubation team.

MENTORING

Unlike traditional VCs at Frost Data Capital we are involved in mentoring our companies on a daily basis. In most cases, our leadership teams are in the same office as our incubator execs.

Our collegial atmosphere also means there is assistance and mentoring available between company teams.

SHARED OWNERSHIP

At a high level, the cap tables of our companies would be familiar to any VC on Sand Hill Road. We have common stock, an option pool and our funds & investors own preferred stock. Where we differ is that the common stock is not broken down in the typical way. There are three fundamental ownership pools:

Founder’s stock for the incubator team.

A competitive stock package for the CEO & CTO,

and other employees.

A shared pool for the CEOs and CTOs

of the other portfolio

companies.

We view each component of the Frost Data Capital Model as

individual threads.

THE FROST MODEL

Our model is woven from these threads and creates a strong climbing rope for our startups to scale the

heights.

LEARN MORE

For more information, please

visit our website www.frostdatacapital.com